Defined Benefit Plans for Small Business Owners Give Your Self-Employed & Small Business Clients a Presenting…

2 Agenda  Consider DB Plans in a Recession Economy: –Help self-employed & small business owners rebuild wealth  Describe Dedicated DB’s OnePersonPlus ® Program  Compare DB to other plans  Identify Ideal Clients – Who Qualifies?  Prospect for $1MM Accounts –Building your business – What we deliver –Cultivating CPAs and Attorneys as Centers of Influence  Close the Sale

3 Dedicated Defined Benefit Services  Dedicated to providing the best small business DB plan – It’s all we do!  Helps you offer an outstanding tax strategy for FAs to present to self-employed and small business clients  Creates a high-quality experience for financial professionals and their clients -- from pre-sale through administration  Minimizes demand for technical expertise from financial professionals by providing expert plan consulting  Delivers Financial Professionals’ support –Expertise by phone – –Expertise online -

Retirement Recovery Plan  LARGE contributions for the next 5-10 years $1MM to $2MM in New Retirement Wealth  LARGE deductions tax-deduction, saves client $40,000-$60,000 or more in ‘09  You seek stable, low risk investments – Not promising high returns  Clients now ready to rebuild –Who shied away from commitment Defined Benefit Plans for Today

5 Retirement Plans for High-Income Clients SIMPLE SEP 401(k) DB DB + 401(k) Defined Benefit (DB) plans may allow your clients to contribute significantly more earned income than other retirement plans $49,000 $171,300 $54,500 $21,350 $134, Plan Maximum Contribution Limits for a 52-year-old, Earning $245,000 Annually, Retiring in 10 Years

6 Great Tax Strategy for Baby Boomers!  Identify Prospects Easily –Owner age 45+ –Owner employees –Contribute at least 3 successive years  About New Plans –Avg. annual contributions: $120,000 –Avg. term: 9+ yrs –Prototype plan documents –Integrates with a solo 401(k)

2009 Retirement Recovery Plan 1.Identify clients you can help most 2.Start the conversation – before they contribute to a SEP or 401(k) for ’09 3.Talk about redeployment of assets to execute a low risk tax strategy 4.Present a Proposal 5.Let Dedicated DB Help You Close the Sale 6.Collect up to 50% of Assets Before Year-End 7 A Recovery Plan to Implement Now!

8 Dr. Charles, Owner-only Sole Proprietor, Age 52  Annual earnings: $400,000  Maximum DB+ 401(k) contribution for 2009: $171,300 –Contribution to DB Plan: $134,600 –Contribution to 401(k): $36,700  Annual tax savings: $65,100 –Combined marginal tax rate of 38%  DB Accumulation at age 62: $2.36 Million –10 years, 5 - 7% rate of return  Annual DB Benefit: $195,000 Objective: Wants Maximum Tax Deduction

John, Age Employees Small Business Owner, C-Corp  Owner’s W-2 income: $400,000 –Employee 1 age 28 earning $35,000 –Employee 2 age 35 earning $45,000  2009 Maximum DB contribution for owner: $162,400 –DB Contribution for Employee 1: $4,000 –DB Contribution for Employee 2: $8,100 –93% of contribution for John  Annual income tax savings for John: $61,700*  Retirement accumulation for John at 62: $1,655,000  Annual Benefit for John in retirement: $136,500 *Assumes 38% combined State/Federal marginal rate 9

10 Married Couple in Business Together C-Corp, Paul, Age 60, Mary, Age 58  5 Years from Retirement  W-2 Income: $490,000 ($245,000 each)  Total annual DB contribution: $351,800 – $171,800 towards Paul’s Retirement – $180,000 towards Mary’s Retirement  Annual income tax savings: $133,700  Accumulation at retirement: –Paul: $1,103,000 –Mary: $1,156,000 Objective: Maximize Retirement Savings

11 Side Income, Sole Proprietor Susan, Age 56, Professor Susan has self-employment income from consulting and serving on 2 corporate boards in addition to university salary  Self-employment earnings after paying SE tax: $150,000*  Maximum DB contribution for 2009: $120,000  Annual tax savings: $45,600 –combined marginal tax rate of 38%  DB Accumulation at age 62: $984,100 –6 years, 5 - 7% rate of return  Annual DB Benefit: $81,200 * High 3-year average, after payment of self-employment tax

12 Building Your Business in Today’s Economy What We Deliver Sales Support & Plan Design Advisor Website, Calculator & Proposal System  Ideal Clients  Proposal Generator  Advisor and Client Brochures  Sales Kit Ongoing Support  Training for Advisors  Sales Presentations  Quarterly e-newsletters  Client & Advisors Communications Sales Support & Client Marketing Materials

Building Your Business in Today’s Economy Cultivating the Right Centers of Influence  Deliver Training and Continuing Ed to CPAs, Attorneys 13

14 Prospecting for $1Million Accounts  Independent Consultants  Board of Directors –Board fees qualify as self-employment income –Income is not necessary to maintain life style  Self-Employed Spouses with “Second Incomes” –CPA and Advisor often forget that self-employed spouse’s second income can be sheltered  Software programmer  Therapist  Sales rep  Paralegal  Technical writer

15  University Professors with Consulting Contracts –Business, Engineering, Medical Schools, Economics Dept –Their bios on the university website  Physicians –Anesthesiologists –Dentists –Emergency Room doctors –Radiologists –Vets Prospecting for $1Million Accounts

16  CPAs, a Great Referral Source –Create awareness, uncover qualified small business clients –Help CPA identify high net worth clients who have a problem to solve – consultants, doctors, dentists, etc –Present to groups of CPAs  Attorneys, another Great Referral Source –Estate planning attorneys –Patent attorneys –Attorneys who assist business owners to sell a business Prospecting for $1Million Accounts

17 Closing Your Sale 1.Run a proposal online at 2.Present to client 3.Request a customized proposal: Discuss with client’s CPA – Dedicated DB on a conference call 5.Complete Set-Up Questionnaire/Send to Dedicated DB –With Set-Up Fee ($1,250 for 1-person plan) 6.Receive Adoption Agreement for signature 7.Open investment account

18 Thank You!  Contact our DB Experts – –  Art Leaffer  Co-Founder of Dedicated DB  Designing retirement products for 30 years  Contact me anytime: –